Affordable Housing Through Smart Mortgage Financing: Technology, Analytics, And Innovation

Abstract

Toward achieving affordable housing for lower- and middle-income individuals, this book proposes a family of new smart mortgage origination, servicing, and secondary-market technologies and systems that are built on artificial intelligence, advanced data analytics, and blockchain technology, as well as on transaction-cost economics. A critical mission for government, quasi-government, and private-sector housing finance initiatives whose combined annual outlays total roughly $600 billion is to bridge the gap between soaring home prices and stagnant middle-class income growth that has persisted for many years. To meet this challenge, our book proposes a family of smart, tech-enabled, nutritionally stamped mortgage technologies that shift traditional mortgage origination and servicing tasks away from highly compensated professionals to low-cost service partners, but in a careful and compliant way. We propose a new slate of smart, stakeholder-supported, mortgage origination, servicing, and secondary-market technologies that are founded on strategic partnerships among lenders, servicers, nonprofits, housing agencies and institutions, real estate and technology companies, and investors. New collaboration-rewarding technologies offered as add-on modules to successful customer relationship management systems will facilitate the construction of transactional information links that will lower structural transaction costs among the various stakeholders associated with smart mortgages.

We believe that our proposed innovation in mortgage finance technology is both practical and achievable within the existing structure of public policy and that it can be realized through active public-private collaboration and cooperation. Our approach is to innovate in small steps, learning from the positive and the negative experiences of the various housing initiatives undertaken at all levels of government, both domestically and abroad. The proposed new mortgage origination, servicing, and secondary market technologies that will be discussed in this book have been designed and tested by some of my graduate students and their friends.